M&A volumes expected to rise
9% year on year in Q3 2014
2 July 2014
Nearly 14,000 M&A deals worth $1.38 trillion have been announced thus far in 2014 and the Deloitte M&A Index forecasts this to approach c22,500 deals by the end of the third quarter. The Index predicts 8,350 deals (by volume) in the third quarter of 2014, equivalent to a 9% rise year-on-year and a 6% increase on the second quarter of 2014.
Iain Macmillan, head of M&A at Deloitte, the business advisory firm, comments: “Several high-profile withdrawn deals have skewed the public perception of the current M&A market, disguising a steady uptick in global M&A deal volumes.
“The rise in deal volumes is being driven by a boom in US deal making, where despite the severe weather related setback, US companies accounted for 55% of all disclosed deals by value in the second quarter. Europe is a key target for US companies, year to date they have spent $89 billion on European companies and are likely to spend in excess of $150 billion on European deals this year.
“We believe the M&A market is on an upward trajectory as a number of hostile bids suggest that companies are looking to get deals done.
“The global IPO market is also performing strongly, in the year to date, over 700 companies have come to market totalling 53% of 2013 volumes, the highest recorded first half IPO volumes since 2011. Companies have raised proceeds of $103 billion which is a 20 per cent increase over the same period in 2013.
“However, only small amounts of the proceeds from IPOs are being channelled towards growth. We found nearly 34% of the amounts raised were earmarked for general corporate purposes, an 8% increase over 2013. It seems companies are taking advantage of the favourable conditions to raise equity, but have not yet decided how they want to use the proceeds.”
Notes to editors
The Deloitte M&A Index is a forward-looking statistical indicator that forecasts future global M&A deal volumes and identifies the factors influencing conditions for deal activities.
In this press release references to Deloitte are references to Deloitte LLP, which is among the country's leading professional services firms.
Deloitte LLP is the United Kingdom member firm of Deloitte Touche Tohmatsu Limited (“DTTL”), a UK private company limited by guarantee, whose member firms are legally separate and independent entities. Please see www.deloitte.co.uk/about for a detailed description of the legal structure of DTTL and its member firms.
The information contained in this press release is correct at the time of going to press.
Member of Deloitte Touche Tohmatsu Limited.
"Several high-profile withdrawn deals have skewed the public perception of the current M&A market, disguising a steady uptick in global M&A deal volumes." - Iain Macmillan, Head of M&A at Deloitte